Business Juice response to the Ofgem / Citizens Advice small business factsheet on working effectively with third party intermediaries (TPIs).
Business Juice welcome the updating of the factsheet from the collaboration between Ofgem & Citizens Advice. Whilst we suspect the circulation of this document is limited we believe that the intent and spirit of the document is well placed.
The factsheet poses some critical questions for understanding the value and quality of a TPI. Below we respond to these questions and provide correction and clarification where Ofgem’s knowledge falls short of the picture.
Do TPIs always research the whole market?
There are 33 active suppliers in the business energy market
We have direct commercial relationships with 30 of these
One we do not operate with as they do not meet the standard we expect for our customers
The remaining two are new entrants with whom we are entering preliminary discussions about a partnership.
Will a TPI always find the best energy deal for you?
We believe that on the balance of probability we will.
Regardless of the route to market used, all energy suppliers will include a cost of sale in the price they charge per kWh of electricity or gas. We as a business claim this cost from the supplier in return for delivering appropriate customers to them, we however set our costs at below the marginal cost of sales of energy suppliers. In that way we can always offer our customers a price below the market level.
If a customer approached a supplier directly we would expect the full cost of sale to be included in the price offered to the customer.
Are you obliged to accept an offer from a TPI?
Absolutely not, our service is free at the point of use in literal and metaphorical terms. We do not charge for our market analysis and supplier and price matching services, indeed customers can use our services and transact elsewhere without it having cost them a penny – of course we hope they don’t but the nature of the business is that in providing transparency and customer freedom with no tie-ins…..
Are all offers presented in the same way?
No. However our approach is to demystify this.
Business Juice only recognise, and therefore sell, a contract as “fully fixed” where there are no contractual terms within the supplier terms and conditions that allow a change to any element of the publicised price under normal market conditions.
We also ensure that where an element of the energy price is not included in the base rate we enable our customers to make a comparison on a like for like basis.
Is there a set duration for contracts?
No, but this is categorically not a bad thing. The flexibility in contract terms in the business energy market enables advantageous deals to be struck from 1 month to 5 years and sometimes beyond.
Once a term is entered it is fixed – Ofgem describe this as being “locked in” however this term is used derogatively in connection with termination feeds, the reality is somewhat different – locking in to the right contract means certainty in cost and long term savings against the notoriously volatile energy market.
And given our service extends across the lifetime of that contract, if the deal is right for your business in the first place, and it will be, then why would you want to exit?
Whilst we can’t vouch for other TPIs that is our approach.